Thank you very much. These answers were very informative and helpful.

I would also add that it does affect your property taxes because the sales price is lower. We just completed a high priced home purchase and it was important to us that the 3% fee I would normally have been paid (as the buyer's agent - but the buyer was me) was deducted from the sales price so that we weren't paying property taxes on that additional amount (adds up over time).
Once last thing. In terms of: Does that type of term in the offer make it more appealing to the seller? Well, most sellers are going to look at their "net" on the sale. So, for example, as a seller I'd be indifferent to an offer of $100,000 where I pay the buyer's agent's commission of 3% ($3000) or an offer of $97,000 where the buyer pays his/her agent's commission directly.
Good luck with your offer!

Hi George,

As David said, you can pay the broker's commission separately. I just completed a transaction recently where I represented the seller. They buyer paid the cost of the broker fees. You want to make sure this is noted in the contract. In my situtation, paragraph 25 of the CAR Residential Purchase Agreement, Other Terms and Conditions was used to clearly state that the buyer was paying the stated brokerage fee and what the amount of the fee was or it could also be included in an Addendum to the contract.

There is a potential real estate tax benefit, but it depends on how much you end up paying for the property. For example, if the property was listed at $100,000 and your offer stated that the purchase price of the property is $94,000 and you would pay $6000 in commissions. The seller still ends up with the benefit of effectively receiving $100,000. Since the tax base is typically based upon the sale price, the real estate tax base is now based upon $94,000 instead of $100,000. The savings is small, but it is a savings that could add up over time. This savings does not exist it you offer to pay the $100,000 and the $6,000 to cover commissions. Be sure to demonstrate to the seller that you have the cash to make the deal happen as stated.

I would also check to make certain there is not a commission being paid to the seller. If the seller is a Realtor working for a brokerage, there very well maybe a fee that needs to be paid to cover the expenses associated with listing a home. Many Brokerages will offer a discount to their agents if they are selling their own home, but it is not "free".

Good Luck,
April Tavares, GRI, ASP
Realtor, DRE License #01742179

Yes, you can pay for the buyer brokers commission. I don't believe it would impact your property tax. I know someone who did this. To be sure, you might want to check with the county assessors office and also your CPA just in case. If those two don't work out, I'm sure a real estate attorney would know.

Good luck,

Dave "Tap" Tapper
Realtor
Cashin Company http://www.DavidTapper.com
650-403-6252